Andrei Illarionov, a free-market adviser to Russian President Vladimir Putin, publicly condemned the December forced sale of Yukos's main oil-producing unit, calling it the worst misappropriation of public funds in 2004 and warning that state intervention was hollowing out Russia's economy.
On 19 December, Yuganskneftegaz, which produces around one million barrels a day and holds 17 percent of Russia's oil reserves, was auctioned off for $9.35 billion to the obscure shell company Baikalfinansgroup. State oil producer Rosneft later disclosed it had acquired that company, completing what amounted to a nationalization. Gazprom had been the expected buyer but withdrew after a US court injunction blocked its participation.
Illarionov argued the purchase price could only have come from the state treasury, burdening ordinary Russians. The auction was nominally held to settle $27.5 billion in tax claims against Yukos; analysts, though, described it as a Kremlin effort to reassert control of strategic energy assets and neutralize Yukos founder Mikhail Khodorkovsky, who remains imprisoned. The campaign is widely attributed to Igor Sechin, a former intelligence officer who heads an influential group of ex-security-service figures around Putin.
Illarionov compared the seizure to Venezuela's oil nationalizations in 1976 and predicted slower growth as state bureaucrats displaced private management. He said Putin's goal of doubling GDP within 10 years was unreachable under the current course. Mobile operator VimpelCom, facing $157 million in tax demands tied to a business dispute, was cited as a sign the pattern was spreading beyond the energy sector.
Historical summary. TurkishPress restated this AFP wire report, first published in December 2004, in its own words.